Consumer spending peaks each year during November and December, a period often referred to as the "holiday shopping season."

This report explores how credit card borrowing patterns evolve during and after the annual peak in consumer spending in November and December each year and how this period of borrowing may correlate with financial distress. Additionally, this report studies how quickly these balances are repaid in subsequent months.

Key findings include:

General purpose credit card debt and retail store card debt exhibit end-of-year peaks with monthly aggregate balances steadily rising before the end of the calendar year and then falling gradually through March.

Consumer credit card borrowing experiences differ across consumers with different credit scores and different credit card utilization rates. The seasonal rise and fall in balances is greatest among consumers with superprime credit scores and consumers with lower utilization rates. In contrast, balances for consumers with subprime credit scores exhibit relatively little seasonality, and there is evidence this is related to their relatively high utilization rates.

Seasonal delinquency patterns may indicate financial distress among some credit card borrowers at the end of the year.

The data used in this report are from the Bureau’s Consumer Credit Panel, a longitudinal, nationally-representative sample of approximately five million de-identified credit records maintained by one of the three nationwide credit reporting companies.